Bank Qualified Bank Direct Tax-Exempt Loan Program

What is the Bank Qualified Bank Direct Tax-Exempt Loan Program?

The City of Minneapolis offers a financing program to provide cost-effective tax-exempt financing for capital projects for smaller 501 (c)(3) organizations for projects in the $500,000 to $2 million range. The program offers 1) lower than typical conventional interest rates as a result of the tax-exempt status of interest to the bank purchasing the bonds and 2) lower cost of issuance and less lead-time from application to actual funding since the program documents are pre-approved by the City of Minneapolis and Bond Counsel.

Terms and Conditions

Bank Qualified Bank Direct tax-exempt revenue bonds can be issued below commercial-market interest rates due to the tax-exempt status of interest to the bank purchasing the bonds.

The interest rate can either be variable or fixed.

All documentation is prepared by bond counsel. All parties are represented by their respective counsel.

Bank Qualified Bank Direct tax-exempt revenue bond issuance expenses include bond counsel and sometimes a financial advisor. These fees may be financed through the bonds up to certain limits.

Who is Eligible

Smaller not for profit 501(c)(3) organizations

Eligible Uses

Capital projects with improvements to the facility in the range of $500,000 to about $2 million

How to Apply

Complete an online application here, or to request a printed application please call (612) 673-5072. Applicants should also include:

financial statements for the past two years and any interim statements

appraisals and environmental reports about the proposed project

A City staff person will handle your loan application from initial inquiry through post-closing monitoring.

The complete public approval process takes about 45-60 days after the application is received, if a bank has committed to purchasing the bonds.

The City approves bank direct loans based on the public purpose served, such as preserving and creating jobs, increasing the real estate tax base, and providing community services.

All programs and guidelines are subject to change without notice. Online information from the City of Minneapolis at MinneapolisMN.gov/CPED

Last updated Jan 18, 2019

QUICK LINKS

Accessibility: For reasonable accommodations or alternative formats, contact 311. People who are deaf or hard of hearing can use a relay service to call 311 at 612-673-3000. TTY users can call 612-673-2157 or 612-673-2626.